Reflective of weakness in China and the US, growth in global manufacturing activity decelerated sharply in August with the J.P. Morgan-Markit global manufacturing PMI gauge falling to 50.7.
While activity has expanded for 33 consecutive months, the reading was the lowest seen since April 2013.
The survey covers over 10,000 purchasing executives in over 30 countries, and reflects an estimated 89% of global manufacturing output, according to Markit.
Results were mixed across the globe, with strength in Europe overshadowed by weakness in developing nations, particularly in Asia.
“The Czech Republic, Italy, Spain and Germany recorded the fastest rates of output expansion during August,” said Markit, noting that “conditions continued to strengthen in the eurozone, with output growth accelerating to a 15-month high”.
Despite expanding at the weakest pace seen in 19 months, the US, due to its large relative size, was also a significant contributor to the latest increase in global manufacturing production, it added.
While those nations all contributed to growth in manufacturing activity, China, France, South Korea, Indonesia, Malaysia, Russia, Greece and Brazil all dragged on the broader index.
As the table below reveals, much of the weakness in August was as a result of slower growth in output and employment.
Output fell to just 51.0 – its lowest level in 28 months – while employment slipped to 50.2 from 50.7 in July courtesy of the slowest pace of hiring in the US for the past 13 months.
Elsewhere, new business ticked up to 51.4 from 51.3 – still anaemic levels of growth – while new exports orders contained to contract.
Reflective of the low-inflation environment currently being experienced around the world, readings on input and output prices remained subdued. Markit notes that average costs rose at the weakest pace in four months while output prices declined in emerging markets, but increased in developed nations.
Given the trend this year – the global PMI gauge has averaged 51.3 this year compared to 52.3 in 2014 – and continued weakness in forward indicators such as new orders, there is little to suggest that a recovery in manufacturing activity, let alone global growth, will occur in the remainder of 2015.
SEE ALSO: The New York Stock Exchange is under attack for the way it handled the most volatile market in years